Debt Advice and Denial
on: May 12, 2009, 4:45 am
Author: Melanie Taylor
Advisers Direct have underlined the importance of seeking debt
advice before financial problems reach the stage where they're
the midst of a recession, professional debt advice has an even
greater role to play than usual," said Melanie Taylor, Head
of Corporate Relations for Debt Advisers Direct. "With repossession
and unemployment figures rising and many households living with
the threat - or the actuality - of reduced income, people across
the country are realising that once-manageable debts are suddenly
taking up much more of their monthly budget. In many cases, the
strain is simply too much."
insolvency trade body R3 recently expressed its concern 'that
those with financial problems do not think they 'need' debt advice'.
Quoting from YouGov's quarterly 'DebtTracker' of February 2009,
R3 pointed out that only 37% those who had fallen behind with
many bills or credit commitments had actually taken action and
sought debt advice in the previous six months.
those who acknowledged that they were struggling with bills and
commitments, a full 65% were of the opinion that they simply did
not need advice about their financial problems.
alarming to see so many people in trouble and not looking for
help," Mrs Taylor continued. "Financial problems rarely
resolve themselves unless the individual takes positive action.
Clearly, many people are able to do so on their own, but while
it's good for people to have confidence in their skills, even
the most financially capable people may find they benefit from
the insights which someone who specialises in debt could supply.
worrying is the thought of people who desperately need to look
for debt advice but have yet to do so - either because they've
not realised the severity of their financial problems or because
they're nervous about asking for help.
the first of these two groups, we would like to stress the need
for everyone to keep a close eye on their income and expenditure
at all times - and this is especially important during challenging
economic times when incomes are more likely to fluctuate and access
to debt solutions such as debt
consolidation or remortgagingmay be relatively restricted.
One call to a debt adviser should help them gain some clarity
on their situation, helping them understand exactly where they
stand and what their options may be.
the second group (those who acknowledge their financial problems
but may be embarrassed about seeking help), we would like to make
three specific points. First, that there are plenty of people
in their situation; second, that debt advisers are there to help,
not to judge; and third, that the solution to their debt problems
could well be much simpler than they expect.
people don't want to face up to their debt problems because they
dread hearing that bankruptcy, repossession, or some other 'extreme'
scenario is the only way forward. In the vast majority of cases,
however, these fears are unfounded. It's true that there were
10,400 repossessions in the final three months of 2008, yet this
only represents 1 in 1,100 mortgages - just as the 19,000 bankruptcies
in that period represent an extremely small percentage of the
people facing debt problems.
they take the step and talk to a debt adviser, borrowers may be
surprised to realise their lenders are willing to consider ways
of repaying their debts in a way that's actually quite manageable.
the earlier they seek debt advice, the more options they'll probably
have open to them. By taking action sooner rather than later,
they're likely to save themselves a great deal of time and worry,
as well as money (in the form of fees, legal costs and interest
Contact Details: Debt Advisers Direct (http://www.debtadvisersdirect.co.uk/)
South Langworthy Road
0845 056 6480